Should You Add to Your Losing Trades?
02/25/2015 6:00 am EST
Michael Seery of SeeryFutures.com highlights the trading rule he feels is extremely important, but is also the one he witnesses being abused constantly, creating tremendous loses that are sometimes difficult to come back from.
Should you add to your losing trades? This rule is extremely important and I witness it being abused constantly creating tremendous loses that are sometimes difficult to come back from. Never add to a losing position, because if the position continues to go against you—and now you have added even more contracts which are all losing money—your account will suffer loses much more than 2%, and in some cases, adding positions and never getting out of a losing trade has wiped people’s trading accounts down to zero because of one or two bad trades.
Remember, always play for another day, you will have losing trades and the good traders manage losses and move on to the next possible trade.
By Michael Seery of SeeryFutures.com